Stocks on Wall Street tumbled as weak economic data overshadowed excitement over the resurgence in deal activity.
The Dow Jones Industrial Average closed 144.48 points, or 1.4%, down at 10,271.06, weighed by a slide in economically sensitive General Electric, which fell 3.8%.
Chip giant Intel dropped 3.3% after it agreed to pay $US7.7 billion to acquire computer-security software maker McAfee, whose shares soared 57%.
But this was eclipsed when weekly US jobless claims rose to 500,000, moving up by more than expected, to their highest level since November 2009.
In more gloomy news, an index of leading economic indicators rose 0.1% in July, the Conference Board reported, while economists had expected a 0.2% increase.
The Nasdaq Composite was down 1.7% to 2178.95. The S&P 500 index dropped 1.7% to 1075.63, weighed by its cyclical materials and industrial sectors.
The major benchmark indexes are now all in the red for the week, month and year.
Other markets: Europe down, Asia up
European stocks sank, pushing key indexes to their lowest close in a month. The Stoxx Europe 600 index ended down 1.4% at 253.90, its lowest close since July 21.
The UK's FTSE 100 closed down 1.7% at 5211.29, Germany's DAX lost 1.8% to 6075.13, and France's CAC-40 closed 2.1% lower at 3572.40.
Japanese shares fronted a rally across Asia as expectations of further monetary easing measures weakened the yen and bolstered electronics and automobile exporters. Japan's Nikkei Stock Average climbed 1.3% to 9362.68.
Australia's S&P/ASX 200 gained 0.1% to 4479.02, Korea's Kospi added 1% to 1779.64 and Taiwan's Taiex edged up 0.1% 7928.94.
China's Shanghai Composite Index rose 0.8% to 2687.98 and Hong Kong's Hang Seng Index was up 0.2% to 21,072.46.
India's Sensex was up 0.9% to 18,454.94, while Singapore's Straits Times Index climbed 0.9% to 2946.77.
Commodities: Oil down, gold up
Crude oil futures prices fell below $US75 a barrel, amid pressure from high inventories and fresh concerns over the pace of the US economic recovery.
Light, sweet crude oil September futures prices in New York were down 82USc at $US74.60 a barrel, after moving in a range of $US74.26-76.10 a barrel.
The contract, which expires at Friday's settlement, has dropped in nine of the past 11 days, after hitting a three-month high near $US83 a barrel Aug 4.
Gold futures hit a seven-week high, boosted by a flight to safety.
The most-actively traded gold contract, for December delivery, was up $US1.50 at $US1232.90 an ounce in New York. Earlier in the session, gold hit an intraday high of $US1239.50, a level the metal hadn't traded above since July 1.
Currencies: Dollar up, euro down
The US dollar turned higher against the euro and pared losses against the Japanese yen as investors sought the relative safety of the greenback.
The dollar had been lower earlier, under pressure from strong UK retail sales and a rosier forecast for German economic growth.
The euro fell to $US1.2815, from $US1.2878 in on Wednesday. It earlier rose as high as $US1.2902.
The euro bought ¥109.36, down from ¥109.94. The dollar traded at ¥85.32, little changed from Wednesday.
The UK pound, meanwhile, gave up earlier gains spurred by a stronger-than-expected increase in retail sales in July. It declined to $US1.5581 from $US1.5619 late on Wednesday.
Fri, 20 Aug 2010